IN THE HOUSE

CASE STUDY READ THIS TO THE END!

these idle apartments on line every two weeks. Since we took over in October 2012, we have brought rents to market and will have this lost capacity back by March. OKLAHOMA Renovating the property, he Danny and Amber Newberry says, has doubled the after-repair recently closed on a 48-unit mul- value from $15 a foot to $30 a foot. tifamily property they describe as a C+ property in an improving C Can you guess the ages of neighborhood in Oklahoma City. these old hands at real The first phase of a new mall has estate investing? outperformed retail expectations, (The answer is on Page 104.) and the developers have accelerated Phases 2 & 3. A Super WalMart and And then by increasing the net other big boxes are moving into the operating income with all 48 units area. available, we will have increased The Newberrys bought this the appraised value to a conservaunder-tenanted property from a tive $1.6 million or more. delinquent, absentee San Francisco owner for $15 a square foot. With Market RATES & Pet Premium partners, they put $50,000 down on These are desirable 900-squarea $700,000 property, expecting to foot, 2 bed/one bath apartments invest $350,000 in renovation. now rented at around $550 a month The local management had up from $450. A $15 pet premium been Band-Aiding everything, says helps because of a new a dog run Danny. We needed to re-clad the the Newberrys have installed. exterior, bring the nine out-of-ser- Danny and Amber are from vice apartments to rental condition Cedar City in Southern Utah, about and resurface the parking lot. We an hour north of Las Vegas. Danny moved from our Cedar City, Utah, has always liked the idea of buying home to oversee the renovation and homes. He bought his first forecloproperty management until we get sure six years ago, cleaned it up and the property to where it needs to be. rented it. He then bought a nearly vacant six-plex for $25,000 a door. He OUT OF SERVICE & NO PLAN renovated with contractors, spend The former owner had accepted ing $6,000 per unit. The after-repair a 60% occupancy, so the property cost (ARC) of $31,000 became an was only generating $55,000 in net after-repair value (ARV) of $50,000 income. By renovating the prop- a door, increasing the valuation to erty and bringing all of the units to $300,000. production, we have increased the I favored four-plexs, says net to $155,000 a year, says Danny. Danny. I also bought a triplex and Accepting down units would have duplex and a 10-unit property in meant accepting $60,000 in lost Las Vegas. Starting out, family and income. We are bringing one of friends helped with financing and
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APMs Visitors Choice Awards spotlight top property managers

All Property Management is a leading provider of property management connections on the Web. In a move to improve investor and owner experiences with its network of property managers, the company has instituted an annual Visitors Choice Award. The 2012 charter awards are given to 200 property management companies that were selected the most often by the more than 2 million rental property owners who visited All Property Managements website last year. Connecting rental property owners with the right management solutions is the core of our business, said Reggie Brown, CEO of All Property Management. The companies receiving this award are particularly skilled at handling high volumes of new business, and as such, tend to be some of the most experienced managers in our network. The reason we did this is to recognize companies that provide exemplary service. The best rise to the top because they have the greatest customer conversion rates because of best customer facing skills. We are doing this to recognize our best property managers, best practices as a property management distinction and raise industry standards generally. Since APM began in 2004 the company has made more than 100,000 connections between rental property owners and property management companies. APM focuses on helping property owners maximize their rental potential through shared resources and introductions to local property management experts that fit their service needs and property types. In November 2010, the company was purchased by an investment group led by former Microsoft executive and founder of Walkscore and All Star Directories, Mike Mathieu. Under this new ownership, the company now has 15 employees and is aggressively building on its industry leadership by expanding its online network, products and resources designed to connect property owners and managers nationwide. All Property Management Reggie Brown, CEO 206-577-0029 www.allpropertymanagement.com
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This is a textbook example of a couple who believe in real estate and are doing what many investors wish they had done.

IN THE HOUSE
accepted as the mainstream investment that it is, said Managing Editor Linda Wienandt. His expertise in William Leider has joined strategic leadership helps our publiNEX ZUS Publishing Group as cation and the emerging industry that Board Chairman. NEXZUS pubwe cover. lishes Personal Real Estate Investor Magazine, the emerging voice of an emerging industry. NEXZUS also promotes the leading investment provider event Investor Provider Leadership Summit. Leider has served as CEO of several public and private companies. He brings more than 35 years as a strategic consultant to a variety of organizations, from Fortune 500s to entrepreneurial startups and everything in between including Toshiba, KPMG Peat Marwick, Thermador, Paramount Pictures and Oracle. William Leider Leider is the author of the breakthrough book, Brand Delusions. By way of allegories, Leider demon- Leider says he eagerly accepted the strates how companies can be blind challenge of helping the magazine in to their brand deficiencies. Brand its mission to be a watchdog of the Delusions shows how to spot these personal real estate investing indusshortcomings and then strengthen a try as it matures. What I like a lot is the magazines brand to become more successful. Execution of basic principles position and ability to contribute to a and processes that embrace the term growing body of knowledge on a very brand is more than an image, identity practical level, he says. It strives to and message, says Leider. A brand continuously write about topics of curis a widely held set of beliefs and rent relevance to not only investors expectations about what you deliver but also to people and organizations that work in that realm and whose and how you deliver it. I believe that personal real work supports the whole concept of estate investing is an emerging cor- personal real estate investment. nerstone of financial independence for all individual investors and neces- The bottom line is: sary to protecting retirement income it can help people. in our society, Leider says. I believe Leider is looking forward to meetthat Personal Real Estate Investor ing those people whose efforts are Magazine is a powerful investment moving the industry forward. He can advocate and leading voice for this be reached at 602-241-0800, ext. emerging asset class. I am thrilled to 130, or by emailing william.leider@ nexzuspub.com. be a part of this. Leider is a perfect fit for both the He will be in attendance at magazine and the industry at large, the Spring 2013 Investor Provider says PREIM Publisher Andrew Waite. Leadership Summit scheduled to Bill has an innate understanding be held in Baltimore April 25 and of brand, brand positioning and pro- 26, 2013. This event precedes the motion and the importance that must REIExpo April 27-28 at the same play in the effort to make personal location. To register, go to www. real estate investing recognized and PersonalRealEstateInvestorMag.
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WELCOME ABOARD THE BOARD

The Newberrys are no newcomers to real estate investing, even though Amber is just 23 and Danny is 24. advice. I preferred distressed properties, as there is a greater upside. We prefer professional management at all of our properties except for the on-site Oklahoma project we are now involved in. We plan to live on-site for the first few months to renovate and learn the property, then pass the responsibility to a professional property manager. Starting right Heres the kicker: Amber is 23 and Danny is 24, and they control 89 rental doors (SFDs and multifamily). At 18, Danny decided that working for his dad in a used-computer export business was not for him. Beyond just a good financial result, the satisfaction of doing a great job turning around a building and helping tenants provides us deep satisfaction, says Amber, and its lots of fun to be your own boss. Neither Danny nor Amber was born with a silver spoon in his/her mouth, but both have the support of their families. They began as high school sweethearts when she was a sophomore and Danny was a junior. Danny did his first deal in Cedar City at 18 and got hooked. When asked how theyve been able to succeed in a tough economy, Danny says, There is no magic, just planning, analysis and perseverance.
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